Representative questioning by Yasuo Tanaka at the Upper House plenary session. October 3rd, 2008

Good afternoon. I’m Yasuo Tanaka, the leader of New Party Nippon. I have the honor of forming a parliamentary group in the upper house with the Democratic Party of Japan led by Mr. Ichiro Ozawa whom I have a great respect for.

Thanks to the good offices of Chairman Azuma Koshiishi of the DPJ upper house caucus and other parliamentary group members, I’ve been given this opportunity to present, on behalf of my party, questions to the government and the ruling coalition, at this decisive moment in history, when ‘the bell of transience’ is signaling an end in Nagata-cho.

Japan is facing a major turning point. It’s aging rapidly and fewer children are being born. The situation is dire and unprecedented in the history of mankind. According to the National Institute of Population and Social Security Research, by the 2050’s, Japan’s population will go down below 90 million, with foreign nationals included. That means, we will face an annual population decline of nearly 800 thousand, the equivalent to residents in Tokyo’s Setagaya Ward which has the largest population of all 23 wards in Tokyo.

The average number of children a woman gives birth to in her life time is called ‘the total fertility rate.’ Under the current public health condition and with probability of death due to illness and accidents, Japan will diminish in population unless the rate is kept at 2 point 06. But in reality, the total fertility rate in Japan is 1 point 26, which is much lower than that, and it’s expected to remain at the same level in the next 50 years.

Even if the social environment and working conditions are improved dramatically to make it easier for working women to have children and later return to work, the population of 127 million will continue to drop sharply. In 100 years from today, the population will be reduced to half, plunging below 63 million. The situation will become even worse, when the birthrate decreases and the mortality rate increases. The National Institute of Population and Social Security Research forecasts that, in the worst case scenario, the Japanese population will shrink below 340 million in 100 years time.

Departing from materialism to post-materialism. We should break away from a growth-crazed mindset and instead, should start thinking and choosing differently, focusing rather on improved quality than greater quantity. We need to review the way the system works and reinvent it to meet the desires of consumers rather than to suit the convenience of suppliers. By achieving social justice and economic freedom, we need to bring dynamism to the flagging nation. That’s my philosophy and responsibility as the leader of New Party Nippon.

But unfortunately, the Japanese government and politics remain spoilt. There is little sense of crisis. We need a leader who is ‘insightful, decisive and responsible.’ We don’t need a leader who would ‘flinch, surrender or shirk.’ The leader must be capable of inspiring people to work together to ‘expose what’s wrong and make a change to make it right.’ And yet, we can’t even find a single person with the character in your government and the ruling coalition.

Today, quick decision-making and swift action is the order of the day. Even TV stations allow most popular dramas to do only 13 episodes and pull the plug on them if viewer ratings are low. If you remember, Mr. Aso, in September of last year, you said many times that the biggest challenge facing Japan was the bad economy. You said that repeatedly, making appearances in off-season National Bon Dance Festivals on not just 13 but 17 occasions.

During your policy speech on Monday, you stressed that Japan’s economy would require three years to recover. You said, ‘Japan can, and must recover in three years time.’ Well said. But are you and the LDP not responsible for Japan’s failure to pull out of recession, by desperately clinging to power and defending the power-sharing pyramid scheme built on cozy relations among politicians, bureaucrats and business leaders with vested interests? In face of this magnitude of calamity, the lamenting, dismal state of affairs, Mr. Aso, do you not feel overly irresponsible? Well, I’ve already offended you, haven’t I? I can tell from your sour face. Quite understandable.

You may be thinking, ‘ Stop it, young man. I’m 16 years senior than you. Why do I have to listen to a lecture from a freshman like you?’ Mr. Aso, you are the leader of the pampered boys’ cabinet and may be feeling an urge to mumble, ‘Idiot!!’ quoting a famous line from your dear grandfather. But although we may disagree a lot over whether to seek the early dissolution of the diet and subsequent transfer of power, opinions and questions I plan to present shortly are more or less shared by both my friends and foe. Because we all feel the nation needs a savior and NOW is the time.

Back in October, 2000, I became governor of Shinshu Nagano prefecture and I was the only fourth post-war publicly-elected governor. Two of my three predecessors were former civil servants who, among them, stayed in power for over 41 years and 6 months. While the governor palled around with subordinates and assembly members, forming a cozy pyramid, Nagano had fallen into serious financial woes. Its fiscal health became the second worst of all 47 prefectures. Nagano needed a whopping 148 million yen a day just to pay the interests on loans. Inaction was in no way an option. If we failed to act, Nagano would have undoubtedly filed for bankruptcy protection in three years and be placed under fiscal reconstruction. The situation was so critical and afforded no delay.

My No-More-Dam declaration prompted a non-confidence motion against me. I lost my job but reran in the election successfully and became governor again. In my six years as governor, I delivered my pledges and carried out various reforms. As a result, Nagano became the only prefecture in Japan to reduce outstanding debts for six consecutive years, and to achieve back-to-back primary surpluses for seven consecutive years. None of these would have been possible without cooperation or understanding of the public and the employees. I kept faith in hands-on approach and face-to-face dialogues and so continued talking about the importance of ‘thinking and choosing differently to make a change in the system.

I appointed the late Mr. Masao Ogura who is known as the savior of the Yamato Transport Company to help me out in reforming agencies which had become the pork-barrel and Amakudari revolving-doors pandemonium. We not only reviewed all the budget, expenses and subsidies, but personnel dispatches as well. We abolished some and consolidated or downsized other organizations. We overhauled 96 percent of 54 existing organizations. That was Ogura’s last assignment in his public capacity.
The approach is indispensable in the national politics as well. What’s needed is a complete overhaul of mega public works projects. Closing down as scapegoat the ‘Discover Your Future’ vocational museum (a white elephant, built ostensibly to help young people find jobs) is just another cheap trick, anything but reform.

A vast majority of so-called independent administrative agencies would allow bureaucrats to land jobs elsewhere through mediation immediately after their retirement and are in fact operating an Amakudari-money laundering business. If bureaucrats manage to spend two years without causing any problem, they can easily retire into executive posts at construction or pharmaceutical companies. They are protected by what’s called ‘bureaucratic immunity.’
I also reformed the tendering system not only for public works but for all projects. I abolished all murky deals and selective tendering in which the law of the jungle prevails. I instead introduced the open tendering system based on fairness and promoted friendly competition. It pushed down the nearly 100 percent successful bidding rate which was clear evidence of bid-rigging to the nation’s lowest of less than 80 percent.

I used surplus funds generated through such efforts to realize 30-students classes in all elementary schools. Two years ago, several governors were arrested on suspicion of bid-rigging, prompting the Prefectural Governors Association to decide that the open tendering system must be introduced for projects priced over 10 million yen. But even as of today, only 22 prefectures, which are less than 50 percent of all 47, have in fact introduced the system. Murky private contracts remain available, if, for example, an 18 million yen project is split into two separate orders.

In any event, I made efforts to improve welfare, health care, education and environmental protection which will create new jobs for the 21st century. I not only promoted community-based public works projects but sought new ‘Tri-Industrial Revolution’ linking primary industries of agriculture, forestry and fisheries. In the process of making that happen, I decided recovering fiscal health and promoting transparency in tenders was indispensable.

Mr. Aso. In your policy speech, you said, ‘Fiscal reform is necessary, but means should not be confused with ends. Fiscal reform is a means, while the ends are Japan’s prosperity. The goal of the Aso cabinet is to achieve stable, sustainable and prosperous economy.’ Again, well said. But if that’s the case, Mr. Aso, would you please specifically tell me which items you feel proud of, in the one-trillion-plus yen supplementary budget draft, as ends for Japan’s prosperity and means for fiscal reform?

On New Party Nippon website, Japan’ the National Debt Clock created by our policy team is ticking. It’s tallying up money owned by the Japanese government. The national debt is snowballing, it’s adding up a whopping six-point-six billion yen every hour! Well, that amount may not be big enough to surprise you, Mr. Aso, because you are a wealthy man living in Kamiyama-cho, a posh residential district in Shibuya. The name of the town literally means ‘Mount God.’ You are no ordinary citizen.

But, yet, Mr. Aso, you should take note that Japan’s national debt is increasing an average 1 point 2 trillion yen per week. The amount, by coincidence, equals the annual net sales of Ajinomoto General Foods, Japan’s leading food company, on a consolidated basis, with Calpis and other affiliates included. I repeat once again. Japan’s national debt is increasing an average 1 point 2 trillion yen per week! Don’t you yet feel a sense of crisis? If not so, I recommend you please go immediately to hospital and have a checkup.

Mr. Aso, you talk about ‘securing peace of mind.’ But before submitting the supplementary budget proposal, your cabinet decided to issue additional 395 billion yen national bonds and to spend an additional 177 point 8 billion yen in fiscal investment and loan programs. And the decision came immediately after you pledged in your policy speech to achieve primary surpluses by fiscal 2011 for both central and local governments.

No wonder, your pre-pre-predecessor Mr. Junichiro Koizumi, who was known for his trademark ‘lion’s mane’ hair, was fully responsible for worsening the economy, having inflated the national debt by 250 trillion yen in his term in office. Brave rhetoric, grim reality. With secret reserve funds and hidden debts combined, the national debt mounts to one-thousand trillion yen, and Koizumi is responsible for creating one-forth of it in his only five and a half years in office! Oh boy, that’s what he called ‘structural reform.’ What a farce! What a deception! That’s why at a budget committee meeting on January 31st, I called Koizumi-Takenaka’s cabinet a ‘Mickey Mouse team’ carrying out bogus reforms.

Correct me if I’m wrong, Mr. Aso. Are you not trying to make use of your experience as the Public Management, Home affairs and Posts and Telecommunications Minister under the pettifogging cabinet which imposed deceptive Trinity Reform nationwide? Are you not pretending to hope the money will trickle down to the socially-weak, young and old and everyone else in the country? No wonder. The astronomical amount of debt reaching one-thousand trillion yen will be left to be paid by people from far and wide, who are struggling to survive this day and night, and who, despite their hard work, have little means, dreams or hopes for their future. Your plan will leave not only our generation but future generations as well with a massive burden of debt.

And yet, I challenge you to clarify the financial resources, as you challenged us the opposition in your policy speech. Incidentally, during a plenary session on the 29th, Mr. Shoichi Nakagawa, whom you appointed as the finance minister, delivered a speech on the supplementary budget proposal. He also published a lengthy essay in a monthly magazine titled ‘13 policies to revive Japan’s economy.’
In the headlines, he wrote, ‘Reform at the expense of people is preposterous’ ‘Don’t hesitate, if tax cuts or fiscal spending is necessary.’ ‘Support for the elderly,’ ‘for single mother homes,’ ‘for freeters(part-timers),’ ‘for full time workers,’ and so forth. I felt so funny! I couldn’t believe what I was reading! So I looked at the contents page again, thinking ‘Did I overlook a subtitle? Isn’t this a declaration of ‘ignoring financial resources ?’

Some media people apparently shared my concerns and have come up with an estimate of 21 trillion yen in public spending to execute your policy proposals. What are you talking about? Mr. Nakagawa, please clarify the source of funding.

But judging from my experience as governor of a mountainous prefecture, I know having a debate on financial resources is nothing but unproductive. What’s in need are ideas and their implementation, but not a debate on whether to clarify financial resources. Economic recovery and fiscal reconstruction are no warring concepts which require a debate on priorities.
Instead, all budget requests need to be reviewed. All human costs, obligation fees and ordinary expenses for any project at all require a zero-based review, right from the drafting phase of the proposal. Without that, protecting people’s lives and achieving solid economic growth, which Mr. Nakagawa is advocating in his emergency proposal ‘’Stop reform for the sake of reform,’ will be impossible to achieve.

When I first became governor, I felt like being a boy detective every day, looking for answers to various questions. Why are these projects included in the budget? or why have these subsidies being set aside? There were many, many questions which needed answers. I kept asking whys all the time, not only inside my famous ‘glass office’ but wherever I went for inspections. And most of the answers I received from people in charge of finance or those concerned were far from satisfactory. It took a while for me to learn that those projects and subsidies were earmarks set aside by assembly members or organizations including commerce and industries and agricultural groups. I learned those funds had been secured and preserved for people with vested interests over a long time period, without ever being reviewed in annual budget compilations.

Mr. Aso, you say you always trust the nation’s ability to meet the challenges of change; the nation’s ability to survive and grow. But what helped Japanese manufacturers overcome various difficulties had always been their decisions and ability to remove the ceiling and to create a mechanism to make it happen. The ceiling is a budgetary jargon frequently used in the politics by the government at the time of budget compilations. The ceiling, off course, means a cap on budget. Whether it’s road maintenance or home-visit nursing care improvement, any ten projects costing one million yen each would cost 10 million yen in total. But when fiscal discipline is enforced, setting an across-the-board 20 percent cap in the budget, government agencies would usually maintain unit costs and eliminate two out of the ten projects. That’s how the system works in the government.

But private companies including manufacturers would think and work differently. They would reduce the unit cost to 800 thousand yen so no project would be removed and the total costs would be 8 million yen. Of course, cheap and nasty gets punished by consumers. Wisdom and team efforts are indispensable in maintaining quantity as well as quality.
People in the gallery as well as those at home watching television, listening to the radio or sitting in front of the computers must be wondering why can’t the government do what the private sector is doing so commonly and so naturally?

The reason is quite simple. Both central and local governments, as well as other public offices, work on discretional contract bases. Projects under the jurisdiction of the Land, Infrastructure and Transport Ministry would never be assigned to the Education and Science Ministry. Projects under the jurisdiction of the Commerce and Industry Department would never be taken over by the Agricultural Policy Planning Department. That’s why friendly competition which stimulates growth among the public sector would never take place in the public sector. It’s as simple as that.

Strangely enough, at the government and other public offices, the costs of public works projects are shown in unit of millions in their budget papers. So, when written in three digit numbers, for example, 215 means 215 million yen, which is worth lifetime earnings. But for some unknown reason, non-public works project costs are shown in thousands. Budget directors who would stop and think whether to spend 380 yen or 420 yen for lunch would have to convert their mathematical apparatus from one million yen to one yen as soon as they sat back at the desk. Dreadful illusions occur when they produce budget drafts for welfare and education which are shown in units of thousands. 2,150 means 2 point 15 MILLION yen, not 2 point 15 BILLION yen, because the unit is in thousands, one-hundredth of one million used for public works projects. So they would mistakenly read the numbers in millions, instead of thousands, and would express reservations about increasing budget for welfare or education. That’s indeed a dreadful illusion.

So clearly, the rule of the game needs to be changed; meaning, people should think, choose and work differently. I said all budget papers should be shown in unit of one yen so that all public works projects worth one billion yen are shown in ten digit numbers. Some officials in my fiscal reform team complained that public works projects carrying a price tag of one billion yen would have many zeros and wouldn’t fit in tiny spaces. So I said, ‘Then, why not use Chinese characters?’ Just as electric calculators, if we combine Arabic numerals with Chinese characters symbolizing thousands, ten-thousands, millions or billions, they SHOULD fit in the space. It will in fact visually enhance awareness and reinforce discipline when budgets are shown in unit of one yen. People’s money will be spent wisely.

My next question is for Mr. Shigeru Ishiba. He is a plastic model czar who uses Pinvice, a fine drill capable of cutting as thinly as one-tenth of a millimeter. He is currently testing ‘bottom-up’ approach’ at the Agriculture, Forestry and Fisheries, where winds are blowing off a steep cliff. Mr. Ishiba, are you prepared to be an eager-beaver, willing to make serious efforts in carrying out drastic awareness reform? Budget papers for public works projects contain huge numbers when it comes to land improvement and irrigation engineering. Those earmarks are notoriously famous for NOT contributing to farmers’ independence or self-sufficiency. Mr. Ishiba, are you prepared to make a change and to revise the format so budgets are shown in unit of one yen?

My next question is for Ms. Seiko Noda. You are one of a few politicians in the trouble-infested LDP whom I have due respect. I would like to hear your candid opinion about what should be a desirable modality of the Consumer Agency.

The role of the Consumer Agency will be extremely important in transforming the politics from one suiting the convenience of enterprises or unions, into another empowering individuals or communities for their future. To make it happen, the process of ‘plan, do, check, redo (planning, execution, verification and re-execution)’ holds the key. Existing ministries and agencies tend to be irresponsible and to cater to the logics of the supply side. Shouldn’t the Consumer agency have the power to say no and to order redoes to the supply side? Shouldn’t the agency be sponsoring a bill to clarify and strengthen its legal authority so it can deliver its mission to live up to the expectations of the consumers?

Here again, it’s clear, the rule of the game needs to be changed; meaning, people should think, choose and work differently. The rule of the game means the system. The system needs to be restructured. Otherwise, food security will never be ensured. And yet, Japan doesn’t have ‘the place of origin identification and control system.’ I feel deeply chagrined, because as governor and with cooperation from sommelier Shinya Tasaki, I successfully instituted a system to disclose information on agricultural produce and processed foods including Japanese Sake, wine, shochu, rice and beef, so that consumers could have access to objective quality assessment.

Last year, I visited the Tokyo District Public Prosecutors Office on September 10th and the Osaka Police headquarters on the 18th to file a criminal complaint against President Mitsuo Fuyuki of Mikasa Foods and then-Agriculture, Forestry and Fisheries Minister Seiichi Ohta, accusing them of attempted genocide and attempted assisted genocide,. What prompted me to take action was the government acting too little too late. At a news conference, then-Chief Cabinet Secretary Nobutaka Machimura said the government planned to carry out unannounced inspections and improve the food distribution system. He apparently believed there would be fewer irregularities if more money was spent on purchasing rat traps and on hiring screeners. But I thought such quick-fixes would in no way solve the problem.

Instituting ‘the place of origin identification and control system’ requires a political decision to respond to the voices of consumers. The system goes beyond the concept of ‘traceability’ which after all is yet another example of IT ‘Hakomono (a white elephant, or a bridge-to-nowhere.) Mr. Ishiba and Ms Noda, may I have your opinions on this?

This question is for Tetsuo Saito who has jurisdiction over environmental administration. On September 11th, Kumamoto governor Ikuo Urashima expressed opposition to the construction of Kawabegawa Dam planned by the Land, Infrastructure and Transport Ministry.
His protest meant a lot to me because I too, as governor, had issued a No-more-dam declaration on February 20’s 2001, attempting to suspend nine dam projects. I’m still fighting for it seriously. What makes his protest even more significant is the fact that Mr. Urashima was a successful candidate for the governorship, endorsed by the government and the ruling coalition. Seven and a half years after my no-more-dam declaration, times have definitely changed.

The no-more-dam policy does more than environmental protection. Whether you know it or not, local autonomies share a 30 percent financial burden for any project including those directly overseen by the central government. In addition to that, 80 percent of the total construction costs for mega public works projects, including dams, are paid to super general contractors whose head offices are located in Tokyo and Osaka. That means, local autonomies are destined to lose money by ten percent. And the system controlling mega public works projects allows the central government to levy money from local governments. It’s very similar to an ancient tax levy system called So-yo-cho which was designed to put money into the government. Dam construction no longer helps revive the local economies but further drives them to bankruptcy. It’s like methamidophos, a deadly poison which infiltrates into the rivers.

On the other hand, forest occupying nearly 70 percent of our land is in ruins. What’s worse, 45 percent of it is manmade, coniferous trees planted after world war two. They are different from broad leaf trees and require thinning. To one’s surprise, only 8 percent of the Forestry agency’s budget is spent on forest preservation. The remaining 92 percent is spent on public works projects including the construction of forest roads or what’s called valley closure, in which concrete or iron steel stakes are planted in streambeds.

Coniferous trees need preservation called thinning when they are between 45 and 60 years old. Two out of three have to be thinned for the stem of the trees to thicken. Coniferous trees planted in 1950’s require immediate attention. Despite the situation, only one third of the 1 point 14 million hectares of manmade forest has been thinned. The Forestry Agency says it plans to thin 550 thousand hectares of forest per year for the next six years. But still 4 point 1 million hectares of forest will be left untouched six years later.

In fact, two-thirds of the thinning budgets are spent to pay for labor costs. It means the work creates jobs for the community. It’s good news for civil engineers living in the intermediate and mountainous areas. When I was governor, I initiated a Green New Deal and increased the thinning area and the budget by 250 percent and organized 100-hour free seminars for locals to learn skills needed for forest preservation as part of efforts to promote employment in the communities.

Forest preservation is not only good for conservation and flood control, but it’s good news for farmers and fishermen in mid and lower streams, as well as oyster and other fishermen at river mouths. I call this a new ‘Tri-Industrial Revolution,’ linking agriculture, forestry and fisheries.

Looking back, both Mr. Tetsuo Saito and I entered politics NOT to bring about wealth or military strength which hurts people but to create a society or government which saves the people from pain and bring them happiness. If the Environment Agency in charge of managing national parks cooperates with other ministries and agencies in proactively allocating the budget and engaging in preservation and management, Japan will be making the most appropriate decision as a nation which hosted the Lake Toya summit. Please let me hear your opinions on the no-more-dam and other policies.

Lastly, Mr. Aso, the 92nd prime minister of Japan, I have one more question for you. This spring, when London-based Children’s Investment Fund (TCI) attempted to boost its shareholding in Electric Power Development Company, then-Economy, Trade and Industry Minister Akira Amari, who now is minister in charge of promoting regulatory reform, said NO WAY and ordered TCI to drop its plan.

On the other hand, on September 5th, a consortium comprising Marubeni Corporation, Kansai Electric Power company, Kyushu Electric Power Company, and the Japan Bank for International Cooperation which is the international division of the wholly state-owned Japan Finance Corporation, announced its decision to acquire all shares of Senoko Power Limited, the country’s largest power generation company, 100 percent owned by investment firm Temasek Holdings which is under the umbrella of the Singapore’s Finance Ministry.

In the beginning my representative questioning, I said, achieving social justice and economic freedom to bring dynamism back to the flagging nation is my philosophy and responsibility as the leader of New Party Nippon.
Mr. Aso, in your policy speech, you said Japan hopes to play the leadership role in creating international rules as a most eco-friendly and energy-conserving nation. Sounds good.

Geopolitically speaking, Japan provides a crossroad to Asia, America and to Oceania. So it finds itself located at a very crucial point where the three circles meet. It’s important for such nation to be trusted by the rest of the world, not viewed as outrageous or unfathomable. For that, it’s important we build our grounds, with right ideas, decisiveness and a clear sense of responsibility.

If so, Mr. Aso, what is your perception on the consistency or inconsistency of the government involving two separate incidents and how would you explain that to the nation and to the rest of the world? You said you were solemnly aware of the weight of the responsibility you are destined to assume. With high expectations towards your insightful responses, I hereby would like to conclude my representative questioning.
Thank you very much for your attention.